LSH residential development survey results revealed

The current planning system is the major obstacle to residential development according to new research by LSH.

Almost half of respondents in a national survey of the sector identified the “challenging, time consuming and costly” planning system as the top issue facing delivery of new homes.

49 per cent felt that planning policy was the major issue while planning obligations costs, availability of land and opposition from local communities were also reported as areas of concern.

Market still rising

However, respondents were much more positive than in 2013 with the market still rising and significant benefits from recent changes in Stamp Duty Land Tax charges.

In 2013 access to finance was the sector’s largest concern but financial conditions have improved dramatically with introduction of initiatives such as the Government’s Help-To-Buy scheme that has supported 73,000 first time buyers to get onto the housing ladder.

More can be done to ease housing shortfall

Dan Bolton, Associate Director from LSH, said: “The over-riding theme from this year’s survey is that not enough is being done to ensure that national planning guidance is being adhered to locally.

“While there has been an upturn in the number of houses being delivered, there is still a feeling that more can be done to help ease the massive shortfall in housing supply.

“The easing of access to finance for developers as well as buyers has had a significant impact but unrealistic expectations on planning obligations and land values, the influence of local pressure groups as well as the general allocation of land remain significant concerns. “

In terms of stimulating the delivery of new housing, 45 per cent felt that the allocation of land by local authorities was the most important factor followed by improved mortgage availability, which was identified by 36 per cent of respondents.

There were significant variations in the data both in terms of region and the size of the developer with the North West currently experiencing an over-supply of residential land and smaller developers identifying planning obligations such as social housing and section 106s as a significantly greater issue than their larger counterparts.

House price growth expected

In terms of house prices, the majority of respondents expected to see continued growth over the coming 12 months with the most confidence in the South East, South West, Central London and the East Midlands. The majority of respondents in Wales, Scotland the North East felt that house prices would remain about the same at best.

The survey was carried out in January and respondents came from across the sector including developers, institutional investors, private land owners, housing associations, the public sector, banking and finance and professional services.

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